Jared&Blumenfeld,&Regional&Administrator,&EPA&Region&9&signed&the&following&

proposed&rule&on&August&30,&2012,&and&EPA&is&submitting&it&for&publication&in&

the&Federal'Register (FR).&While&we&have&taken&steps&to&ensure&the&accuracy&

of&this&Internet&version&of&the&proposed&rule,&it&is¬&the&official&version&

of&the&proposed&rule&for&purposes&of&public&comment.&Please&refer&to&the&

official&version&in&a&forthcoming&FR&publication, which&will&appear&on&the&

Government&Printing&Office's&FDsys&website&

(http://fdsys.gpo.gov/fdsys/search/home.action)&and&on&Regulations.gov&

(http://www.regulations.gov)&in&Docket&No.&EPAQR09QOARQ2012Q0713.

6560$50$P

ENVIRONMENTAL&PROTECTION&AGENCY

40&CFR&Part&52

[EPA$R09$OAR$2012$0713?&FRL$]

Disapproval&of&Implementation&Plan Revisions?&State&of&

California?&South&Coast VMT&Emissions Offset&Demonstrations

AGENCY:& Environmental&Protection&Agency&(EPA).

ACTION:& Proposed&rule.

SUMMARY:& EPA&is&proposing&to&withdraw&its&final approvals of&

state implementation&plan&revisions&submitted&by&the&State&of&

California&to&meet&the&vehicleQmilesQtraveled&emissions offset&

requirement&under&the&Clean&Air&Act&for&the&Los&AngelesQSouth&

Coast&Air&Basin&1Qhour&and&8Qhour&ozone&nonattainment&areas.&EPA&

is&also&proposing&to&disapprove&the&same&plan&revisions.&EPA&is&

proposing&the&withdrawal&and&disapproval actions in&response&to&

a&remand&by&the&Ninth&Circuit&Court&of&Appeals&in&Association'of'

Irritated'Residents'v.'EPA.&The&effect&of&this&action,&if&

finalized&as&proposed,&would&be&to&trigger deadlines&by&which&

new&plan&revisions&meeting&the&applicable&requirements&must&be&
2

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

submitted&by&the&State&of&California&and&approved&by&EPA&to&

avoid&sanctions&and&to&avoid&an&obligation&on EPA&to&promulgate&

a&federal&implementation&plan.&

DATES:& Written&comments&must&be&received&on&or&before&[INSERT&

DATE&30&DAYS&FROM&DATE&OF&PUBLICATION&IN&FEDERAL®ISTER].

ADDRESSES:& Submit&comments,&identified&by&docket&number EPAQ

R09QOARQ2012Q0713,&by&one&of&the&following&methods:

x Federal'eRulemaking'Portal: http://www.regulations.gov.&

Follow&the&onQline&instructions&for&submitting&comments.

x E:mail: tax.wienke@epa.gov.

x Mail or'deliver: Wienke&Tax,&Air&Planning&Office,&U.S.&

Environmental&Protection&Agency,&Region&9,&Mailcode&AIRQ2,&

75&Hawthorne&Street,&San&Francisco,&California&94105Q3901.

Instructions: All&comments&will&be&included&in&the&public&

docket&without&change&and&may&be&made&available&online&at&

http://www.regulations.gov,&including&any&personal&information&

provided,&unless&the&comment&includes&information&claimed&to&be&

Confidential&Business&Information&(CBI)&or&other&information&

whose&disclosure&is&restricted&by&statute.&Information&that&you

consider&CBI&or&otherwise&protected&should&be&clearly&identified&

as&such&and&should¬&be&submitted&through

http://www.regulations.gov or&eQmail.&The&

http://www.regulations.gov :HEVLWHLVDQ3DQRQ\PRXVDFFHVV ́
3

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

system,&and&EPA&will¬&know&your&identity&or&contact&

information&unless&you&provide&it&in&the&body&of&your&comment.&

If&you&send&an&eQmail&comment&directly&to&EPA,&your&eQmail&

address&will&be&automatically&captured&and&included&as&part&of&

the&public&comment.&If&EPA&cannot&read&your&comment&due&to&

technical&difficulties&and&cannot&contact&you&for&clarification,&

EPA&may¬&be&able&to&consider&your&comment.

Docket:& The&index&to&the&docket&for&this&action&is&

available&electronically&on&the&http://www.regulations.gov Web&

site&and&in&hard©&at&EPA&Region&IX,&75&Hawthorne&Street,&San&

Francisco,&California,&94105. While&all&documents&in&the&docket&

are&listed&in&the&index,&some&information&may&be&publicly&

available only&at&the&hard©&location&(e.g.,©righted&

material),&and&some&may¬&be&publicly&available&at&either&

location&(e.g.,&CBI).&To&inspect&the&hard©&materials,&please&

schedule&an&appointment&during&normal&business&hours&with&the&

contact&listed&in&the&FOR&FURTHER&INFORMATION&CONTACT section&

below.

FOR&FURTHER&INFORMATION&CONTACT:& Wienke&Tax,&Air&Planning&

Office,&U.S.&Environmental&Protection&Agency,&Region&9,&Mail&

Code&AIRQ2,&75&Hawthorne&Street,&San&Francisco,&California&

94105Q3901,&415Q947Q4192,&tax.wienke@epa.gov.
4

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

SUPPLEMENTARY&INFORMATION:& 7KURXJKRXWWKLVGRFXPHQW3ZH ́3XV ́

and 3RXU ́refer&to&EPA.

Table&of&Contents

I. Background

A. Regulatory&Context

B. South&Coast&Ozone&Designations&and&Classifications&and&

Related&SIP&Revisions

C.&/LWLJDWLRQRQ(3$¶V)LQDO$FWLRQRQ6RXWK&RDVWQHour&

Ozone&SIP

D.&/LWLJDWLRQRQ(3$¶V)LQDO$FWLRQRQ6RXWK&RDVWQHour&

Ozone&SIP

II. Proposed&Withdrawal&of&Previous&Approvals,&and&Proposed&

Disapproval,&of&VMT&Emissions&Offset&Demonstrations

III. Proposed&Action and&Request&for&Public&Comment

IV.& Statutory&and&Executive&Order&Reviews

I. Background

A. Regulatory'Context

The&Clean&Air&Act&(CAA&or&Act)&requires&EPA to&establish&

national&ambient&air&quality&standards&(NAAQS or&"standards")&

for&certain&widespread&pollutants&that&cause&or&contribute&to&

air&pollution&that&is reasonably&anticipated&to&endanger&public&

health&or&welfare&(see§ions&108&and&109&of&the&CAA).
5

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

In&1979,&under§ion&109&of&the&CAA,&EPA&established&a&

primary&healthQbased&NAAQS&for&ozone1 at&0.12&parts&per&million&

(ppm)&averaged&over&a&1Qhour&period.&See&44&FR&8220g (February&

9,&1979). The&Act,&as&amended&in&1990,&required&EPA&to&designate&

as&nonattainment&any&area&that&had&been&designated&as&

nonattainment&before&the&1990&Amendments [section&107(d)(1)(C)

of&the&Actg&56&FR&56694g (November&6,&1991)].&The&Act&further&

classified&1Qhour&ozone&nonattainment areas,&based&on&the&

severity&of&their&nonattainment&problem,&as&Marginal,&Moderate,&

Serious,&Severe,&or&Extreme.&

The&control&requirements&and&date&by&which&attainment&of&

the&1Qhour&ozone&standard&was&to&be&achieved&varied&with&an&

DUHD¶VFODVVLILFDWLRQ0DUJLQDODUHDVZHUHVXEMHFWWRWKHIHZHVW

mandated&control&requirements&and&had&the&earliest&attainment&

date,&November&15,&1993,&while&Extreme&areas&were&subject&to&the&

most stringent&planning&requirements&and&were&provided&the&most

time&to&attain&the&standard,&until&November&15,&2010.&The&

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 1

&&GroundQlevel&ozone&or&smog&is&formed&when&oxides&of&nitrogen&(NOX),&

volatile&organic&compounds&(VOC),&and&oxygen&react&in&the&presence&of&

sunlight,&generally&at&elevated&temperatures.&Strategies&for&reducing&smog&

typically&require&reductions&in&both&VOC&and&NOX emissions. Ozone&causes&

serious&health&problems&by&damaging&lung&tissue&and sensitizing&the&lungs&to&

other&irritants.&When&inhaled,&even&at&very low&levels,&ozone&can&cause´&

respiratory&problems,&aggravate asthma,&temporary decreases&in&lung capacity&

of&15&to&20&percent in&healthy&adults,&inflammation&of&lung&tissue,&lead&to&

hospital admissions&and&emergency&room&visits,&and&impair&the&body's&immune

system&defenses,&making&people&more&susceptible&to&respiratory illnesses,&

including&bronchitis&and&pneumonia.
6

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

various&ozone&planning&requirements&to&which&Extreme&ozone&

nonattainment&areas&are&subject&are&set&forth&in§ion&172(c)&

and§ion&182(a)Q(e)&of&the&CAA.&Of&particular&importance&for&

the&purposes&of&this&proposed&action,§ion&182(d)(1)(A)&

requires&the&following:

"Within&2&years&after&November&15,&1992,&the&State&shall&

submit&a&revision&that&identifies&and&adopts&specific&

enforceable&transportation&control&strategies&and&

transportation&control&measures&to&offset&any&growth&in&

emissions&from&growth&in&vehicle&miles&traveled&or&numbers&

of&vehicle&trips&in&such&area&and&to&attain&reduction&in&

motor&vehicle&emissions&as&necessary,&in&combination&with&

other&emission&reduction&requirements&of&this&subpart,&to&

comply&with&the&requirements&of&subsection&(b)(2)(B)&and&

(c)(2)(B)&of&this§ion&(pertaining&to&periodic&emissions&

reduction&requirements).&The&State&shall&consider&measures&

specified&in§ion&7408(f)&of&this&title,&and&choose&from&

among&and&implement&such&measures&as&necessary&to&

demonstrate&attainment&with&the&national&ambient&air&

quality&standardsg&in&considering&such&measures,&the&State&

should&ensure&adequate&access&to&downtown,&other&

commercial,&and&residential&areas&and&should&avoid&measures&
7

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

that&increase&or&related&emissions&and&congestion&rather&

than&reduce&them."

EPA&believes&that&it&is&appropriate&to treat&the&three&

required&elements&of section&182(d)(1)(A)&(i.e.,'offsetting

emissions&growth,&attainment&of&the&rateQofQprogress&(ROP)

reduction,&and&attainment&of&the&ozone NAAQS)&as&separable.&As&

to&the&first element&of&CAA§ion&182(d)(1)(A) (i.e.,'

offsetting&emissions&growth caused&by&growth&in&vehicle&miles&

travelled&(VMT)),&EPA had historically&interpreted&this&CAA

provision&to&allow&areas&to&meet&the requirement&by&

demonstrating&that emissions&from&motor&vehicles&decline each&

year&through&the attainment&year. See,&e.g., 57&FR&13498,&at&

13521Q15323g (April&16,&1992).&This&proposed&rule&relates&only&

to&the&first&element&of§ion&182(d)(1)(A)&(i.e.,'offsetting

emissions&growth caused&by&growth&in&VMT).&Herein,&we&refer&to&

this&element&as&the&Vehicle&Miles&Traveled&(VMT)&emissions&

offset&requirement&("VMT&emissions&offset&requirement") and&the&

demonstration&submitted&to&us&to&address&this&requirement&as&the&

"VMT&emissions&offset&demonstration."

In&1997,&EPA&replaced&the&1Qhour&ozone&standard&with&an&8Q

hour&ozone&standard of&0.08&ppm.&See 62&FR&38856g (July&18,&
8

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

1997).2 We&promulgated&final&rules&to&implement&the&1997&8Qhour&

ozone&standard in&two&phases.&The&"Phase&1" rule,&which&was&

issued&on&April&30,&2004 (69&FR&23951)&establishes,&among&other&

things,&the&classification&structure&and&corresponding&

attainment&deadlines,&as&well&as&the&antiQbacksliding&principles&

for&the&transition&from&the&1Qhour&ozone&standard&to&the&8Qhour&

ozone&standard.&For&an&area&that&was&designated nonattainment&

for&the&1Qhour&ozone&standard&at&the&time&when&EPA&designated&it&

as&nonattainment&for&the&1997&8Qhour&ozone&standard as&part&of&

the&initial&8Qhour&ozone&designations,&most&of&the&requirements&

that&had&applied&by&virtue&of&the&area's&classification&for&the&

1Qhour&ozone&standard&continue&to&apply&even&after&revocation&of&

the&1Qhour&ozone&standard&(which&occurred&in&June&2005 for&most&

areas).&See&40&CFR&51.905(a)(1)&and&40&CFR&51.900(f).&Thus,&for&

example,&an&area&that&was&designated&nonattainment&and

classified&as&Extreme&for&the&1Qhour&ozone&standard&at&the&time&

of&an&initial&designation&of&nonattainment&for&the&8Qhour&

standard&remains&subject&to&the&VMT&emissions&offset&requirement&

under&CAA§ion&182(d)(1)(A)&for&the&1Qhour&ozone&NAAQS&even

if&the&area&would¬&otherwise&have&been&subject&to&that&

particular&requirement&based&on&the&area's&classification&for&

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 2

&&In&2008,&EPA&tightened&the&8Qhour&ozone&NAAQS&to&0.075&ppm,&see 73&FR&16436

(March&27,&2008).&Today's&proposed&action&relates&only to&SIP&requirements&

arising&from&the&classifications&and&designations&of&the&South&Coast&with&

respect&to&the&1979&1Qhour&ozone&and&1997&8Qhour&ozone&standards.
9

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

the&1997&8Qhour&ozone&standard. See&40&CFR&51.905(a)(1)&and&40&

CFR&51.900(f)(11).

The&Phase&2&rule,&which&was&issued&on&November&29,&2005 (70&

FR&71612),&addresses&the&SIP&obligations&for&the&1997&8Qhour&

ozone&standard.&Under&the&Phase&2&rule,&an&area that&is&

designated&as&nonattainment&for&the&1997&8Qhour&ozone&standard,&

and&classified&under&subpart&2&(of&part&D&of&title&I&of&the&

CAA),&is subject&to&the&requirements&of&subpart&2&that&apply&for&

that&classification. See&40&CFR&51.902(a).&Among&the&

requirements&for&areas&classified&as&Severe&or&Extreme&for&the&

1997&8Qhour&ozone&standard&is&the&VMT&emissions&offset&

requirement&under&CAA§ion&182(d)(1)(A).

B. South'Coast'Ozone'Designations'and'Classifications'and'Related'

SIP'Revisions

As¬ed&above,&the&CAA,&as&amended&in&1990,&required&EPA&

to&designate&as&nonattainment any&area&that&had&been&designated&

as&nonattainment&before&the&1990&Amendments.&The&CAA&also&

required&EPA&to&classify&nonattainment areas as&Marginal,&

Moderate,&Serious,&Severe,&or&Extreme&depending&upon&the&design&

value&of&the&area.&On&November&6,&1991,&EPA&designated&the&Los&

AngelesQSouth&Coast Air&Basin&Area&("South&Coast")3 as&

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 3

&&The&South&Coast&includes&Orange&County,&the&southwestern&twoQthirds&of&Los&

Angeles&County,&southwestern&San&Bernardino&County,&and&western&Riverside&

County&(see&40&CFR&81.305).
10

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

nonattainment&and&classified&it&as&Extreme&for&the&1Qhour&ozone&

standardg&thus&the&area&had an&attainment&date&no&later&than&

November&15,&2010&(56&FR&56694).&

The&California&Air&Resources&Board&(CARB)&has&submitted&a&

number&of&SIP&revisions&over&the&years&for&the&South&Coast&Air&

Basin&to&address&1Qhour&ozone&SIP&planning&requirements.&

Specifically,&in&1994,&CARB&submitted&a&1Qhour&ozone&SIP&that,&

among&other&things, included&for&the&South&Coast an&attainment&

demonstration,&ROP&demonstrations,&and&transportation&control&

measures&(TCMs).&In&1997,&EPA&approved&the&1994&Ozone&SIP as&it&

applied&to&the&South&Coast&for&the&1Qhour&standard.&See&62&FR&

1150g (January&8,&1997).

In&1997&and&1999,&CARB&submitted&revisions&to&the&1994&

South&Coast&1QHour&Ozone&SIP,&including&revised&ROP&

demonstrations,&and&a&revised&attainment&demonstration&

("1997/1999&South&Coast&1QHour&Ozone&SIP").&See&65&FR&18903g

(April&10,&2000).&In&2004,&CARB&submitted&revisions&to&the&

1997/1999&South&Coast&1QHour&Ozone&SIP&("2003&South&Coast&1QHour&

Ozone&SIP").&In&2008,&the&2003&South&Coast&1QHour&Ozone&SIP&was&

supplemented&by&submittal&of&a&VMT&emissions&offset&

demonstration4 that&was&intended&to&comply&with&the&VMT&emissions&

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 4 Letter&from&Elaine&Chang,&Deputy&Executive&Officer,&South&Coast&Air&Quality&

Management&District,&dated&September&10,&2008,&approved&at&40&CFR&

52.220(c)(339)(ii)(B)(2).
11

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

offset&requirement by&showing&that&there&would&be&no&upturn&in&

HPLVVLRQVEHWZHHQWKHDUHD¶VEDVH\HDUIRUWKH6,3UHYLVLRQDQG

WKHDUHD¶VDWWDLQPHQW\HDU,Q(3$GLVDSSURYHGWKHUHYLVHG

ROP demonstrations&and&attainment&demonstration&in&the&2003&

South&Coast&1QHour&Ozone&SIP,&but&approved&the&VMT&emissions&

offset&demonstration that&had&been&submitted&in&2008.&74&FR

10176g (March&10,&2009).5

With&respect&to&the&1997&8Qhour&standard,&EPA&designated&

the&South&Coast&as&nonattainment&and&classified&the&area&as&

"SevereQ17,"&but&later&approved&a&request&by&California&to&

reclassify&the&South&Coast&to&"Extreme."&See&69&FR&23858g (April&

30,&2004)&and 75&FR&24409g (May&5,&2010).&In&2007,&CARB&

submitted&a&SIP&revision&to&address&the&8Qhour&ozone&SIP&

planning&requirements&for&the South&Coast ("2007&South&Coast&8Q

hour&Ozone SIP").&The&2007&South&Coast&8QHour&Ozone&SIP&

included,&among&many&other&elements,&a&VMT&emissions&offset&

demonstration&addressing&the&VMT&emissions&offset&requirement

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 5

&&In&response&to&comments&on&EPA's&proposal&to&partially&approve&and&

partially&disapprove&the&2003&South&Coast&1QHour&Ozone&SIP,&EPA&indicated&

that&the&second&and&third&elements&of&CAA§ion&182(d)(1)(A)&were&satisfied&

in&1997&when&EPA&approved&the&1994&South&Coast&1QHour&Ozone&SIP's&

transportation&control&strategies&and&TCMs,&such&as&TCMQ1&(3Transportation&

Improvements"),&which&includes&the&capital&and&nonQcapital&facilities,&

projects,&and&programs&contained&in&the&Regional&Mobility&Element&and&

programmed&through&the&Regional&Transportation&Improvement&Program&(RTIP)&

process&to&reduce&emissions,&in&the&same&action&in&which&EPA&approved&the&

South&Coast&ROP&and&attainment&demonstrations.&See&74&FR 10176,&at&10179g

(March&10,&2009).
12

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

under CAA§ion&182(d)(1)(A).6 Consistent&with&the&approach&

used&for&the&demonstration&submitted&for&1Qhour&ozone&purposes&

in&2008,&the&2007&South&Coast&8QHour&Ozone&SIP&showed compliance&

with&the&VMT&emissions&offset&requirement,&as&then&interpreted&

by&EPA, by&showing&that&aggregate&motor&vehicle&emissions&are&

projected&to&decrease&each&year&from&the&base&year&through&the&

attainment&year&(2024).&

In&March&2012,&EPA&approved&the&2007&South&Coast&8QHour&

Ozone&SIP,&including&the&VMT&emissions&offset&demonstration&

addressing&the&VMT&emissions&offset&requirement&under&CAA&

section&182(d)(1)(A).&See&77&FR&12674g (March&1,&2012).&

C. /LWLJDWLRQRQ(3$¶V)LQDO$FWLRQRQ6RXWK&RDVW:Hour'

Ozone'SIP

In&approving&the&VMT&emissions&offset&demonstration&that&

was&submitted&by&the&South&Coast&Air&Quality&Management&District

to&supplement the&2003&South&Coast&1QHour&Ozone&SIP,&EPA&applied&

its&thenQlongstanding&interpretation&of&the VMT&emissions&offset&

requirement&under&CAA§ion&182(d)(1)(A) that&no&TCMs&are&

necessary&if&aggregate&motor&vehicle&emissions&are&projected&to&

decline&each&year&from&the&base&year&of&the&plan&to&the&

attainment&year. See&74&FR&10176,&at&10179Q10180g (March&10,&

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 6

&&See&pages&6Q23&and&6Q27&(table&6Q12)&of&the&Final&2007&Air&Quality&

Management&Plan,&June&2007,&prepared&by&the&South&Coast&Air&Quality&

Management&District.
13

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

2009).&(3$¶V2009&approval&was&challenged&in&the&U.S.&Court&of&

Appeals&for&the&Ninth&Circuit,&and,&in&2011,&the&court&ruled&

against&EPA,&determining&that&EPA&incorrectly&interpreted&the&

statutory&SKUDVH3JURZWKLQHPLVVLRQV ́in§ion&182(d)(1)(A)&

DVPHDQLQJDJURZWKLQ3DJJUHJDWHPRWRUYHKLFOH HPLVVLRQV ́&&In&

other&words,&the&court&ruled&that&additional&transportation&

control&strategies&and&measures&are&required&whenever&vehicle&

emissions are&projected&to&be&higher&than&they would&have&been&

had&vehicle&miles traveled¬&increased,&even&when aggregate&

vehicle&emissions&are&actually decreasing. Association'of'

Irritated'Residents'v.'EPA,&632&F.3d&584,&at&596Q597&(9th&Cir.&

2011),&reprinted&as&amended&on&January&27,&2012,&686&F.3d&668,&

further&amended&February&13,&2012&("AIR'v.'EPA").

Based&on&this&reasoning,&the&court&remanded&the&approval&of&

the&VMT&emissions&offset&demonstration&back&to&EPA&for&further&

proceedings&consistent&with&the&opinion.&In&May&2011,&EPA&filed&

a&petition&for&panel&rehearing&requesting&the&court&to&

reconsider&its decision&as&to&the&VMT&emissions&offset&

requirement.&In&January&2012,&the&court&denied&the&request&and&

issued&the&mandate&shortly&thereafter.&

D. /LWLJDWLRQRQ(3$¶V)LQDO$FWLRQ on'2007'South'Coast'8:Hour'

Ozone'SIP
14

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

As&of&December&15,&2011, the&time&of&signature&on&the&final&

rule&approving&the&2007&South&Coast&8Qhour&Ozone&SIP,&the&court&

had¬&yet&responded&to&our&petition&for&panel&rehearing&in&AIR'

v.'EPA.&Notwithstanding&adverse&comments&on&the&proposed&

approval&of&the&VMT&emissions&offset&demonstration&in&the&2007&

South&Coast&8QHour&Ozone&SIP,&EPA&proceeded&to&approve&the&

demonstration&on&the&basis&of&the&same&rationale&that&had&been&

rejected&by&the&Ninth&Circuit&in&connection&with&the&VMT&

emissions&offset&demonstration&submitted&as&part&of&the&2003&

South Coast&1QHour&Ozone&SIP.&The&final&rule&was&ultimately&

published&on&March&1,&2012&(77&FR&12674).&Shortly&thereafter,&

several&environmental&and&community&groups&filed&a&lawsuit&in&

the&Ninth&Circuit&challenging&that&approval.&Communities'for'a'

Better'Environment,'et'al. v.'EPA,&No.&12Q71340.&&

II. Proposed&Withdrawal&of&Previous&Approvals,&and&Proposed&

Disapproval,&of&VMT&Emissions&Offset&Demonstrations

As¬ed&above,&the&Ninth&Circuit&rejected&EPA's&longQ

standing&interpretation&of&the&first&element&of§ion&

182(d)(1)(A)&that&states&could demonstrate&compliance&with&the&

VMT&emissions&offset&requirement&through&submittal&of&aggregate&

motor&vehicle&emissions&estimates&showing&yearQoverQyear&

declines&in&such&emissions. These&demonstrations formed&the&

basis&for&our&consideration&and&approval&of&the§ion&
15

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

182(d)(1)(A)&VMT&emissions&offset&demonstrations&submitted&in&

connection&with&the&2003&South&Coast&1QHour&Ozone&SIP and&the&

2007&South&Coast&8QHour&Ozone&SIP.&IQUHVSRQVHWRWKHFRXUW¶V

rejection&of&our&interpretation&of&the&Act&and&its&remand of&our&

action&approving&the&VMT&emissions&offset&demonstration for&the&

1Qhour&ozone&standard,&we&are&proposing&the&following&two&

actions.

First,&we&are&proposing&to&withdraw&our&previous&approval&

of&the&VMT&emissions&offset&demonstration in&our&March&8,&2009&

final&action&on&the&2003&South&Coast&1QHour&Ozone&SIP. Second,&

we&are&proposing&to&withdraw&our&March 1,&2012&approval&of&the&

portion of&the&2007&South&Coast&8QHour&Ozone&SIP&that&was&

submitted&to address&the&VMT&emissions&offset&requirement&of&CAA&

section&182(d)(1)(A).

Withdrawal&of&our&approvals&of&the&two§ion&182(d)(1)(A)&

demonstrations&would&remove&them&from&the&California&SIP&and&we&

would&be&obligated&to&take&action&on&them&under§ion&110(k),&

unless&the&State&were&to&also&withdraw&the&demonstrations&from&

their&submissions&to&us. To&date,&the&State&has¬&withdrawn&

these&demonstrations. Therefore,&in&this&action,&we&are&

proposing&to&disapprove&them.&Specifically,&we&are&proposing&to&

disapprove&the&demonstrations&submitted&by&California&to&

demonstrate&compliance&with&the&VMT&emissions&offset&requirement&
16

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

under&CAA§ion&182(d)(1)(A)&with&respect&to&the&1Qhour&and&8Q

hour&ozone&standards&because&they&are&predicated&on&EPA's&

previous&interpretation&of§ion&182(d)(1)(A)&that&has&been&

rejected&by&the&Ninth&Circuit.&The&demonstrations&are¬&

consistent&with WKHFRXUW¶VUXOLQJon the&requirements&of&

section&182(d)(1)(A)&because&they fail&to&identify,&compared&to&

a&baseline&assuming&no&VMT&growth, the&level&of&increased&

emissions&resulting solely&from VMT&growth&and&to&show&how&such&

increased&emissions&have&been&offset&through&adoption&and&

implementation&of&transportation&control&strategies&and&

transportation&control&measures.

III. Proposed&Action&and&Request&for&Public&Comment

EPA&is&proposing to&withdraw&and&to&disapprove&our&final&

approvals&of&SIP&revisions&submitted&by&the&State&of&California&

to&demonstrate&compliance&with&the&VMT&emissions&offset&

requirement&under&CAA§ion&182(d)(1)(A)&with&respect&to&the&

1Qhour&and&8Qhour&ozone&standards in&the&South&Coast&

nonattainment&area.&EPA&is&proposing&this&action&in&response&to&

a decision&of&the&Ninth&Circuit&in&AIR v.'EPA.&Under§ion&

110(k)&of&the&Clean&Air&Act,&we&are&proposing&to&disapprove&

these&same&plan&elements because&they&reflect&an&approach&to&

showing&compliance&with§ion&182(d)(1)(A)&that&was&rejected

by&the&court&as&inconsistent&with&the&CAA§ion&182(d)(1)(A)&
17

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

VMT&emissions&offset&requirement.&Should we&finalize&the&

disapproval proposed&here,&the&offset&sanction&in&CAA§ion&

179(b)(2)&would&apply in&the&South&Coast&ozone&nonattainment&

area&18&months&after&the&effective&date&of&the final&

disapproval.&The&highway&funding&sanctions&in&CAA§ion&

179(b)(1)&would&apply&in&the&area&six months&after&the&offset&

sanction&is&imposed.&These&sanctions&will&apply&unless&we&take&

final&action&approving&SIP&revisions&meeting&the&relevant&

requirements&of&the&CAA prior&to&the&time&the&sanctions&would&

take&effect.&If&we&propose&approval&of&a&SIP&revision&meeting&

the&relevant&requirements&of&the&CAA&and&determine&at&that&time&

that&it&is&more&likely&than¬&the&deficiency&has&been&

corrected,&sanctions&would&be&deferred.&See&40&CFR&52.31&which&

sets&forth&when&sanctions&apply&and&when&they&may&be&stopped&or&

deferred.

In&addition&to&the&sanctions,&CAA§ion&110(c)&provides&

that&EPA&must&promulgate&a&federal&implementation&plan&

addressing&the&deficiency&that&is&the&basis&for&this&disapproval

two&years&after&the&effective&date&of&the disapproval&unless&we&

have approved a&revised&SIP&before&that&date.

We&are&soliciting&comments&on&these&proposed&actions.&

Comments&will&be&accepted&for 30&days&following&publication&of
18

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

this&proposal&in&the&Federal Register.&We&will&consider all&

comments&in&our&final&rulemaking.

IV.&Statutory&and&Executive&Order&Reviews

A.'Executive'Order'12988,'Regulatory'Planning'and'Review

The&Office&of&Management&and&Budget&(OMB)&has&exempted&this&

regulatory&action&from&Executive&Order&128665,&entitled&

35HJXODWRU\3ODQQLQJDQG5HYLHZ ́

B.'Paperwork'Reduction'Act

This&action&does¬&impose&an&information&collection&

burden&under&the&provisions&of&the&Paperwork&Reduction&Act,&44&

U.S.C.&3501&et'seq.&Burden&is&defined&at&5&CFR&1320.3(b).

C.'Regulatory'Reduction'Act

The&Regulatory&Flexibility&Act&(RFA)&generally&requires&an&

agency&to&conduct&a®ulatory&flexibility&analysis&of&any&rule&

subject&to¬ice&and&comment&rulemaking&requirements&unless&the&

agency&certifies&that&the&rule&will¬&have&a&significant&

economic&impact&on&a&substantial&number&of&small&entities.&Small&

entities&include&small&businesses,&small¬QforQprofit&

enterprises,&and&small&governmental&jurisdictions.&&

This&rule&will¬&have&a&significant&impact&on&a&

substantial&number&of&small&entities&because&SIP&approvals&or&

disapprovals&under§ion&110&and&subchapter&I,&part&D&of&the&

Clean&Air&Act&do¬&create&any&new&requirements&but&simply&
19

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

approve&or&disapprove&requirements&that&the&State&is&already&

imposing.&Therefore,&because&the proposed&withdrawal&of&previous&

approvals&of&certain&SIP&revisions,&and&proposed&disapproval of&

the&same,&do¬&create&any&new&requirements,&I&certify&that&

this&proposed&action&will¬&have&a&significant&economic&impact&

on&a&substantial&number&of&small&entities.&Moreover,&due&to&the&

nature&of&the&FederalQState&relationship&under&the&Clean&Air&

Act,&preparation&of&flexibility&analysis&would&constitute&

Federal&inquiry&into&the&economic&reasonableness&of&State&

action.&The&Clean&Air&Act&forbids&EPA&to&base&its&actions&

concerning&SIPs&on&such&grounds.&Union&Electric&Co.,&v.&U.S.&

EPA,&427&U.S.&246,&255Q66&(1976)g&42&U.S.C.&7410(a)(2).

D.'Unfunded'Mandates'Reform'Act

Under§ion&202&of&the&Unfunded&Mandates&Reform&Act&of&

38QIXQGHG0DQGDWHV$FW ́VLJQHGLQWRODZRn&March&22,&

1995,&EPA&must&prepare&a&budgetary&impact&statement&to&accompany&

any&proposed&or&final&rule&that&includes&a&Federal&mandate&that&

may&result&in&estimated&costs&to&State,&local,&or&tribal&

governments&in&the&aggregateg&or&to&the&private§or,&of $100&

million&or&more.&Under§ion&205,&EPA&must&select&the&most&

costQeffective&and&least&burdensome&alternative&that&achieves&

the&objectives&of&the&rule&and&is&consistent&with&statutory&

requirements.&Section&203&requires&EPA&to&establish&a&plan&for&
20

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

informing&and&advising&any&small&governments&that&may&be&

significantly&or&uniquely&impacted&by&the&rule.

EPA&has&determined&that&the&proposed&withdrawal&and&

disapproval&action&does¬&include&a&Federal&mandate&that&may&

result&in&estimated&costs&of&$100&million&or&more&to&either&

State,&local,&or&tribal&governments&in&the&aggregate,&or&to&the&

private§or.&This&Federal&action&proposes to&withdraw&

previous&approvals&of&certain&SIP&revisions,&and&proposes&

disapproval of&the&same,&and&imposes&no&new&requirements.

Accordingly,&no&additional&costs&to&State,&local,&or&tribal&

governments,&or&to&the&private§or,&result&from&this&proposed&

action.

E.'Executive'Order'13132,'Federalism

Federalism (64&FR&43255,&August&10,&1999)&revokes&and&

replaces&Executive&Orders&12612 (Federalism)&and&12875&

(Enhancing&the&Intergovernmental&Partnership).&Executive&Order&

13132&requires&EPA&to&develop&an&accountable&process&to&ensure&

3PHDQLQJIXODQGWLPHO\LQSXWE\6WDWHDQGORFDORIILFLDOVLQWKH

development&of®ulatory&policies&that&have&federalism&

LPSOLFDWLRQV ́33ROLFLHVWKDWKDYHIHGHUDOLVPLPSOLFDWLRQV ́LV

defined&in&the&Executive&Order&to&include®ulations&that&have&

3VXEVWDQWLDOGLUHFWHIIHFWVRQWKH6WDWHVRQWKHUHODWLRQVKLS

between&the&national&government&and&the&States,&or&on&the&
21

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

distribution&of&power&and&responsibilities&among&the&various&

OHYHOVRIJRYHUQPHQW ́8QGHU([HFXWLYH2UGHU(3$PD\QRW

issue&a®ulation&that&has&federalism&implications,&that&

imposes&substantial&direct&compliance&costs,&and&that&is¬&

required&by&statute,&unless&the&Federal&government&provides&the&

funds&necessary&to&pay&the&direct&compliance&costs&incurred&by&

State&and&local&governments,&or&EPA&consults&with&State&and&

local&officials&early&in&the&process&of&developing&the&proposed&

regulation.&EPA&also&may¬&issue&a®ulation&that&has&

federalism&implications&and&that&preempts&State&law&unless&the&

Agency&consults&with&State&and&local&officials&early&in&the&

process&of&developing&the&proposed®ulation.

This&rule&will¬&have&substantial&direct&effects&on&the&

States,&on&the&relationship&between&the&national&government&and&

the&States,&or&on&the&distribution&of&power&and&responsibilities&

among&the&various&levels&of&government,&as&specified&in&

Executive&Order&13132,&because&it&merely&proposes&to withdraw&

previous&approvals&of&certain&SIP&revisions&implementing&a&

Federal&standard,&and&proposes&disapproval of&the&same,&and&does&

not&alter&the&relationship&or&the&distribution&of&power&and&

responsibilities&established&in&the&Clean&Air&Act.&Thus,&the&

requirements&of§ion&6&of&the&Executive&Order&do¬&apply&to&

this&rule.
22

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

F.'Executive'Order'13175,'Coordination'with'Indian'Tribal'

Governments

([HFXWLYH2UGHUHQWLWOHG3&RQVXOWDWLRQDQG

&RRUGLQDWLRQZLWK,QGLDQ7ULEDO*RYHUQPHQWV ́)5

November&9,&2000),&requires&EPA&to&develop&an&accountable&

SURFHVVWRHQVXUH3PHDQLQJIXODQGWLPHO\LQSXWE\WULEDO

officials&in&the&development&of®ulatory&policies&that&have&

WULEDOLPSOLFDWLRQV ́7KLVSURSRVHGUXOHGRHVQRWKDYHWULEDO

implications,&as&specified&in&Executive&Order&13175.&It&will¬&

have&substantial&direct&effects&on&tribal&governments,&on&the&

relationship&between&the&Federal&government&and&Indian&tribes,&

or&on&the&distribution&of&power&and&responsibilities&between&the&

Federal&government&and&Indian&tribes.&Thus,&Executive&Order&

13175&does¬&apply&to&this&proposed&rule.

G.'Executive'Order'13045,'Protection'of'Children'from'

Environmental'Health'Risks'and'Safety'Risks

EPA&interprets&Executive&Order&13045&(62&FR&19885,&April&

23,&1997)&as&applying&only&to&those®ulatory&actions&that

concern&health&or&safety&risks,&such&that&the&analysis&required&

under§ion&5Q501&of&the&Executive&Order&has&the&potential&to&

influence&the®ulation.&This&rule&is¬&subject&to&Executive&

Order&13045,&because&it&proposes&to withdraw&previous&approvals&
23

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

of&certain&SIP&revisions&implementing&a&federal&standard,&and&

proposes&disapproval of&the&same.

H.'Executive'Order'13211,'Actions'that'Significantly'Affect'

Energy'Supply,'Distribution,'or'Use'

This&proposed&rule&is¬&subject&to&Executive&Order&13211,&

3$FWLRQV&RQFHUQLQJ5HJXODWLRQV7KDW6LJQLILFDQWO\$IIHFW(QHUJ\

6XSSO\'LVWULEXWLRQRU8VH ́)50D\

because&it&is¬&a&significant®ulatory&action&under&

Executive&Order&12866.

I.'National'Technology'Transfer'and'Advancement'Act

Section&12&of&the&National&Technology&Transfer&and&

Advancement&Act&(NTTAA)&of&1995&requires&Federal&agencies&to&

evaluate&existing&technical&standards&when&developing&a&new&

regulation.&To&comply&with&NTTAA,&EPA&must&consider&and&use&

3YROXQWDU\FRQVHQVXVVWDQGDUGV ́9&6LIDYDLODEOHDQG

applicable&when&developing&programs&and&policies&unless&doing&so&

would&be&inconsistent&with&applicable&law&or&otherwise&

impractical.

The&EPA&believes&that&VCS&are&inapplicable&to&this&proposed&

DFWLRQ7RGD\¶Vproposed&action&does¬&require&the&public&to&

perform&activities&conducive&to&the&use&of&VCS.
24

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

J.'Executive'Order'12898: Federal'Actions'to'Address'

Environmental'Justice'in'Minority'Populations'and'Low:Income'

Population

Executive&Order&(EO)&12898&(59&FR&7629&(Feb.&16,&1994))

establishes&federal&executive&policy&on&environmental&justice.&&

Its&main&provision&directs&federal&agencies,&to&the&greatest&

extent&practicable&and&permitted&by&law,&to&make&environmental&

justice&part&of&their&mission&by&identifying&and&addressing,&as&

appropriate,&disproportionately&high&and&adverse&human&health&or&

environmental&effects&of&their&programs,&policies,&and&

activities&on&minority&populations&and&lowQincome&populations&in&

the&United&States.

EPA&lacks&the&discretionary&authority&to&address&

environmental&justice&in&this&proposed&rulemaking.&In&reviewing&

SIP&submissions,&EPA's&role&is&to&approve&or&disapprove&state&

choices,&based&on&the&criteria&of&the&Clean&Air&Act.&

Accordingly,&this&action&merely&proposes to&withdraw&previous&

approvals&of&certain&SIP&revisions,&and&proposes&disapproval of&

the&same,&and&will¬&inQandQof&itself&create&any&new&

requirements.&Accordingly,&it&does¬&provide&EPA&with&the&

discretionary&authority&to&address,&as&appropriate,&

disproportionate&human&health&or&environmental&effects,&using&
25

This&document&is&a&prepublication&version,&signed&by&Jared&Blumenfeld,&

Regional&Administrator,&EPA&Region&9&on&August&30,&2012.&We&have&taken&steps&

to&ensure&the&accuracy&of&this&version,&but&it&is¬&the&official&version.

practicable&and&legally&permissible&methods,&under&Executive&

Order&12898.

List&of&Subjects&in&40&CFR&Part&52

Environmental&protection,&Air&pollution&control,

Intergovernmental&relations,&Ozone,&Reporting&and&recordkeeping&

requirements,&Volatile&organic&compounds.

Authority:&42&U.S.C.&7401&et&seq.

____August&30,&2012 ____/s/_________________

Dated: Jared&Blumenfeld,

Regional&Administrator,

EPA&Region&IX.